Earlier this year, Network Associates acquired TIS, licensed by RSA to
use its encryption algorithms in TIS virtual private network software. RSA
is a wholly owned subsidiary of Security Dynamics.

The latest copyright infringement suit, filed May 13 in U.S. District Court
in San Francisco, is the second between RSA and Network Associates. Network
Associates acquired longtime RSA
rival Pretty Good Privacy last year and
inherited the long-running PGP-RSA
litigation.

RSA's latest suit appears to be in part a tactic in settlement talks over
the PGP suit, which resume May 28. A separate arbitration hearing is
scheduled for October. RSA and Network Associates have been negotiating a
settlement of the PGP case for months, with the price tag still a stumbling
block.

"RSA is a company based on intellectual property," said Paul Livesay, RSA's
general counsel. "Right now we perceive Network Associates as having an
approach to doing business by acquiring companies and ignoring third-party
agreements, so why would we want to assign the license to TIS to a party
that operates in that manner?"

Livesay said the agreement with TIS included specific language to cover
assigning the license in the event of an acquisition.

"RSA was not in a position to assign [the TIS license] to Network
Associates, given the other infringement," he added, acknowledging that the
latest suit would be a discussion point in any settlement talks around the
PGP litigation.

"We are confident that we will be able to ship all our products," said
Peter Watkins, general manager for Network Associates' security products,
saying the suit only addresses its virtual private network (VPN) software. "We
will continue discussions and settlement discussions with RSA on other
matters. We expect to reach resolution."

Watkins said his firm will track sales of the VPN software that uses RSA
technology to pay accrued royalties once the dispute is settled. Network
Associates has requested a new licensing contract with RSA for that product.

The lawsuit may kill the already-shaky Secure One interoperability
alliance involving RSA, Security Dynamics, VeriSign, and McAfee Associates, which
merged last year with Network
General to form Network Associates.

Network Associates said in January that SecureOne remained in its plans. But the company, still
McAfee at the time, never dropped its desktop encryption product as it had
said it would when the alliance was formed. In fact, it now sells PGP's
desktop encryption software.

On June 18, Judge William Orrick is slated to hear RSA's request for a
preliminary injunction to stop Network Associates from shipping certain TIS
software.

What Amazon's one-day shipping means for you: Last week, Amazon announced it will decrease the standard shipping time for Prime members from two days to one. In this Tech Minute, here's how this change will impact your deliveries.